Just before the end of 2020, Lord Clark issued his decision in a case which considered whether or not an action raised to enforce the decision of an adjudicator could also be used to finally determine the dispute between the parties. The circumstances in which this might happen have already been considered by the English courts. Lord Clark was tasked with considering whether the same principles should be extended to Scotland. 

The background to the dispute was as follows:

• McLaughlin was engaged by the Council to construct an extension at Hurlford Primary School. The contract was an amended Standard Building Contract with Quantities for use in Scotland (SBC/Q/Scot) 2011. The Final Certificate was issued. McLaughlin considered that it undervalued the works. It raised a Sheriff Court action.
• McLaughlin then commenced an adjudication, seeking payment of a sum due in respect of an earlier Interim Payment Notice. The Council argued that the Interim Payment Notice was not valid. It also argued that the Final Certificate was conclusive evidence of the sum due. However, the adjudicator made an award in McLaughlin's favour. The Council refused to pay.
• McLaughlin raised an enforcement action in the Court of Session. As part of its defence, the Council argued that the adjudicator had made an error: it argued the Final Certificate was conclusive evidence of the sum due to McLaughlin because it had not been challenged within 60 days (as prescribed in clause 1.9 of the Contract). The Council submitted a counterclaim seeking declarators which would have the effect that the adjudicator's award should not be enforced. The earlier Sheriff Court action was remitted to the Court of Session, so that both cases could be dealt with together.

It has long been accepted that there are very limited grounds upon which an adjudicator's decision can be challenged. Provided that the adjudicator answers the questions he has been asked and unless there is a breach of natural justice or a jurisdiction error, an adjudicator's award will normally be enforced by the court.

In this case, the Council argued that (in limited cases) an error by an adjudicator could be used to challenge enforcement of a decision where an application for final determination of the dispute has already been made and can be dealt with at the same time. This principle was discussed in the English case of Hutton Construction Ltd v. Wilson Properties (London) Ltd [2017], but it only applies in limited circumstances, namely where (1) there is a short and self-contained issue which arose in the adjudication and which the opposing party continues to dispute; (2) the issue requires no oral evidence (or further elaboration) beyond that which can be provided at the hearing; (3) it would be "unconscionable" for the court to ignore the issue.

In response, McLaughlin argued that the approach in the Scottish courts is that an adjudicator's award cannot be challenged on the ground of an error of law. The appropriate course of action is for the court to decide if the adjudicator's decision should be complied with. The parties have to observe that decision, honouring the "pay now, argue later" nature of adjudication. The parties should then raise (or continue with) a court action to finally determine the dispute (given the temporary binding nature of an adjudicator's award). 

Lord Clark saw no difficulty with the principle established in the Hutton case. He recognised that potentially there could be circumstances in which (in the interests of justice) a final determination of a dispute could be made at or around the time of the enforcement proceedings. However, he thought there would probably only be limited circumstances in which that could be done, as it would be unusual for the final determination matter to be "oven ready" at the time of the enforcement hearing. 

Notwithstanding that, in this particular case, Lord Clark was of the view that he could not apply the approach in Hutton. He did not consider that the points raised in the counterclaim sought a final determination of the dispute. He also did not consider that the Sheriff Court action had reached a stage where a final determination could be made. The principle established in Hutton therefore did not apply.

This case confirms that the Scottish courts may be willing to consider making a final decision on the wider dispute between the parties at the same time as they are asked to decide whether or not to enforce an adjudicator's decision. In practice, in Scotland this is going to be difficult to achieve, unless proceedings in relation to the wider dispute have already been raised and are at an advanced stage.

This is a pragmatic decision by the courts, balancing the need to give the parties an adequate opportunity to present their arguments against a desire to bring a swift resolution to their differences.